Why Brazil Considered as Country full of Business Opportunities?

With an area of 8.5 million square kilometers, 195 million inhabitants, a steady-growing industry and strong democracy, Brazil is currently one of the most attractive countries for foreign investors.

While the average growth of the world economy has been negative or close to zero since the economic financial crisis of 2008, Brazil achieved a 7.5% GDP growth in 2010, the highest since 1986.

Although growth was lower than expected in 2012, reaching 0.9%, a recovery path has been indicated by the results for the third and fourth quarters. The Government stimulus measures have shown initial results, which tend to strengthen in the coming months and to be reflected in the GDP result for 2013.

Brazil offers a safe and outstanding investment environment and some of its major competitive advantages presently include:

  • Economic and Social growth with stability
  • The democratic form of government
  • Strong domestic market
  • The richness of natural and cultural assets
  • Environmental sustainability
  • Open markets and multilateralism
  • Clean and abundant renewable energy

Reasons to invest

Stable economic growth with social sustainability

The solid Brazilian economic basis leads the country to a development cycle, with growth in Gross Domestic Product (GDP), robust foreign reserves, a stable financial system and significant social gains. It is important to highlight the reduction in unemployment (- 5.5% in 2012) as well as in social inequality.

Macroeconomic and social structure for a period of transformation

Macroeconomic policies adopted in Brazil in recent years have been quite effective. From 2003 to 2008, the Brazilian government has kept inflation relatively low, repurchased all sovereign debt originated in the 1990s, improved the risk profile of its government bonds and substantially increased the level of foreign reserves. Such measures have led to moderate impacts of the severe global financial crisis that began in 2008 on the Brazilian economy and have set the basis, alongside with other government policies, to a period of long-term transformation of the Brazilian economy and society.

In recent years Brazil has established itself as a middle-class country. More than 50% of the population currently belongs to class C (middle income), with strong consumption potential. The wealthier classes (A and B) also saw rapid expansion, with cumulative growth of about 80% in the last ten years.

Strong domestic market

Brazil has a large and fast-growing consumer market, comprising 202 million people (2015). Over the past five years, more than 26 million Brazilians overcame poverty and another 34 million reached upper, upper-middle and lower-middle social classes.

The average income of the Brazilian population has been increasing since 2004, at the same time as inequality in income distribution has been decreasing.

In 2020, Brazil will be the fifth largest consumer market in the world, with a forecast of US$1.8 trillion in household consumption. In the same year, it is estimated that Brazil will be positioned among the top three markets for automobiles and motorcycles, food and beverages, clothing and perfumes and fragrances.

Foreign trade – opening up markets

With a Gross Domestic Product (GDP) amounting to nearly 50% of the Latin American economy, Brazil has been consolidating its position as an important platform for South American and Southern African markets. Over the past four years, exports of Brazilian products and services have doubled, and imports have grown at a similar pace.

Market diversification has been one of the strategies to increase Brazilian exports. The share of exports to China grew in importance in recent years, from 1.2% to 17.4% in year-to-date. A share of exports to Mercorsur (Excluding Venezuela) partners also increased, from 4.2% in 1990 to 9.4% in 2012.

Abundant renewable and clean energy

Brazilian energy is abundant and diverse. The country is self-sufficient in oil and has several sources of clean energy, such as hydro, wind and ethanol. Today, 47% of the energy production in Brazil is based on renewable sources, out of which 76% of hydroelectric plants.

Democratic and institutional stability

Brazil achieved a record of US$ 65 billion in FDI in 2012, which placed it as the 4th most popular country for FDI inflow during the period. Foreign investors have security and legal permission to send profits to their home countries, and foreign capital is treated in the same way as national.

The high flows of foreign direct investment into Brazil not only have contributed to the expansion of its gross fixed capital formation but also attest to the high confidence the international markets deposit in Brazil. According to estimates by UNCTAD (United Nations Conference on Trade and Development), in 2012 Brazil ranked 4th in terms of FDI inflows in 2012.

Reduced costs for investment

The Government has put in place several measures aiming to reduce investment costs, among which the following stand out:

  • Electricity: reduction of energy costs (up to 32% for firms, and 18% for households)
  • Taxes:  reduction of the tax burden
  • Financial: reduction of interest rates
  • Infrastructure: reduction of infrastructure costs

Infrastructure development

Several major infrastructure programs were announced over the last two years, with investments adding around US$235 billion over the coming years, not to mention the major urban infrastructure works required for the 2014 World Cup and the 2016 Olympics.


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